Bankruptcy is a law that can be used for consumers with different goals and financial issues. It can be used to remove large amounts of debt quickly and allows the individual the opportunity to start rebuilding his or her credit immediately. Sometimes bankruptcy is necessary even when creditors may be willing to forgive you of the debt. It can also protect you during a foreclosure. Whether you are trying to save your home or rid yourself of large amounts of debt piling up, bankruptcy gives the consumer several options.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy has been called the fresh start, due to the consumer’s ability to clear away unmanageable debt quickly and efficiently, and allowing the debtor to rebuild credit quickly. Although Chapter 7 is a great way to eliminate debt, there are many considerations involved when filing a Chapter 7 Bankruptcy. First there are income qualifications the debtor must meet in order to file a Chapter 7. A consumer should contact a qualified attorney to determine whether you qualify based on your income, even if you think it is too high. Second, a Chapter 7 Bankruptcy is a liquidation of assets, and may put the individual’s property at risk during the process. Although this can seem dangerous, certain property called exemptions is protected during this process. Your home, vehicles, and other miscellaneous property may qualify as exemptions during this process. You should speak with an experienced attorney to determine whether Chapter 7 is the proper process for you or if you may need a Chapter 13 Bankruptcy.
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy has several advantages when resolving a consumer’s debt. Chapter 13 allows an individual to make payments on the debt under more manageable terms and allows for the individual to catch up late payments for homes and vehicles. It is even possible to strip off a second mortgage from a home during this process. Sometimes an individual will be paying back all of their debt in this process and sometimes they may be paying only a portion of their debt. Contact the attorneys at the Independence Law Firm today to determine what type of bankruptcy is right for you.
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